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From Surging Demand to Shuttered Businesses: How Latin America’s Top CEOs Navigated the Past Year

Members of II’s Latin America Executive Team share the greatest challenges and biggest opportunities they’ve faced during the Covid-19 pandemic.

It was a tale of two pandemics for the top-scoring chief executives on Institutional Investor’s 2021 Latin American Executive Team.

Leaders in investment management and chemical manufacturing scrambled to cope with unprecedented demand for products, ranging from digital financial platforms to recycled plastics for water bottles, food packaging, clothes, automotive components, and construction materials. It was quite a different story for owners of bricks and mortar assets with no option but to close.

“Our greatest challenge this year might surprise you,” said Alpek’s José de Jesús Valdez, the second-highest scoring chief executive in the oil, gas, and petrochemicals category. “Demand for our products has sharply increased, outpacing domestic supply in the Americas.” The challenge: keeping up when other suppliers failed. Mostly, Valdez said, Alpek was successful. When Alpek’s competitors in the U.S. Gulf Coast region experienced interruptions to their supply of raw materials, power, or natural gas because of the Texas polar vortex in February, Alpek continued operating. At the same time, Valdez said polyethylene terephthalate, a recyclable plastic it supplies, became popular in new categories and for new applications such as Covid supplies, like face masks and syringes, plus packaging for products like shampoo, detergent, milk, eggs, juices, and lettuce.

Meanwhile the last 12 months have mostly been about survival, not expansion, at Aliansce Sonae, the second-largest shopping mall developer in Brazil. Chief executive Rafael Sales, the top-scoring CEO in the real estate category, said 2020 brought with it his toughest decision yet: to close the company’s malls and offices. “Malls are built and meant to never close, besides on Christmas and New Year’s Day,” he said. “Following the authorities’ guidelines, the entire portfolio was closed multiple times.” Staff were let go. Some were later rehired. Shopping, for the most part, moved online. “Now that our malls are once again open, we see how crucial it was to remain relevant to clients,” Sales said.

Stepping aside was the toughest business decision Guilherme Benchimol of the Brazilian investment management company XP Inc made in the last year. After 20 years as chief executive, he has become executive chairman, nominating Thiago Maffra as his successor. He knew it was the right thing, he told II, but that didn’t make it easier. “XP has been my life since I founded it in 2001,” he said. “It took me long hours of thoughts and conversations in order to make the final decision.” Benchimol started the firm 20 years ago with less than $2,000 in initial capital after he was fired from his brokerage firm in Southern Brazil. He steps away from the helm at the age of 45, with a net worth of $2.6 billion, according to Forbes.

But he leaves on a high. After leading XP through its public offering in December 2019, Benchimol was forced to rapidly expand XP’s capacity as the company, which provides low-fee financial products and services, faced an unprecedented increase in trading volumes across its platforms at the start of the pandemic. What’s more, all the work was done by employees working from home. He said the transition to remote working was so successful that the company has now launched XP Anywhere, an initiative embracing flexible working in order to attract top talent from anywhere in the world. 

As he leaves the chief executive post, Benchimol is in a reflective mood. The most important lesson he learned in his business career? Sharing his dream with people who got it — and stuck with him for the duration. “Much of XP’s success to date was achieved due to the partnership model,” he said. “That empowers employees and makes them real owners and CEOs of the company.” 



Guilherme Benchimol, XP Inc

What is the greatest challenge for your sector this year?

Due to the ongoing process of digitization and the growing importance of technology in financial services, I believe that successful companies will have to keep up with these trends and constantly innovate to better serve their clients. On XP, we’ve been conducting a meaningful digital transformation over the last four years that has already started to bear fruits in terms of client satisfaction and new functionalities and products. Such initiatives are even more important when we look at positive structural developments, for example PIX (zero cost instant payments) and the Open Banking agenda, which are being implemented by the central bank and should make the industry more dynamic and less concentrated, ultimately benefiting consumers.

What was the toughest business decision you made in the last year?

After 20 years as the CEO of XP Inc., I decided with my partners to step up to the executive chairman role and nominate Thiago Maffra as my successor as CEO, which was announced in early 2021. I’m confident that the decision was the best for XP’s future and we can both contribute to and better impact the company as I’ll focus on strategic long-term initiatives while Maffra leads the day-to-day operations. Thus, the decision itself was not tough on rational terms and the process was fairly natural; however, as XP is my life since I founded it in 2001, it took me long hours of thoughts and conversations in order to make the final decision and start the transition process.

Have there been any unexpected opportunities for your business in the last year?

Undeniably, the world has changed throughout 2020 due to the unfortunate events related to the pandemic, which affected millions of people to whom we have deep compassion. In such a challenging environment, we didn’t spare efforts to make our employees safe in a timely manner, contribute with donations to impacted families, and be closer than ever to our clients. The home office model made us realize that our people can be equally or even more productive than they were working at the office full time. This new reality provided greater cost efficiency and a more flexible lifestyle for our employees, and it allowed us to launch XP Anywhere, an initiative that expanded meaningfully the pool for talent attraction on a global scale. 

What’s the best business advice you have received?

Dream big, start slow, and don’t be afraid to make mistakes, always correcting them quickly and with humbleness.

What’s the most important lesson you have learned in your career?

Along many important values and lessons, I would say that sharing my dream with people who complement me and being aligned with them for the long term was the main one. Much of XP’s success to date was achieved due to the partnership model that empowers employees and makes them real owners and CEOs of the company. One of my main focuses as founder and executive chairman is to nurture our culture and long-term alignment through an ever stronger partnership model.



Rafael Sales, Aliansce Sonae

What is the greatest challenge for your sector this year?

Since the beginning of the Covid-19 pandemic, the sector’s greatest challenge was to keep providing solutions to customers, even while the malls were closed and operating with all sorts of restrictions. Throughout the past year, we have come up with different innovative resources for consumers, such as the option for buying products online through our malls’ websites, and worked on a series of logistics alternatives for delivery, receiving, and pick-up of acquired goods. As a result, we already have over 4,900 of our 7,000 tenants on our digital platforms. Now that our malls are once again open, we see how crucial it was to remain relevant to clients. Our current challenge is to strengthen our omnichannel presence further, boost sales, and achieve results compared to pre-pandemic levels.

What was the toughest business decision you made in the last year?

The tougher decision was the correct one: We had to close our malls and offices. Malls are built and meant to never close, besides on Christmas and New Year’s Day. However, aiming to preserve the health and well-being of all customers, team members, tenants, and partners, and following the authorities’ guidelines, the entire portfolio was closed multiple times. And, as a consequence, unfortunately, we had to let several team members go. However, thankfully we have already been able to rehire a good part of them. Despite all, I am personally proud of how our company handled the situation promptly, safely, and with as much care as possible.

Have there been any unexpected opportunities for your business in the last year?

We are constantly looking into M&A opportunities. Last year, we successfully concluded some divestment opportunities and increased our stake in one of our premium malls. The transactions were aligned with our strategic pillar of increasing our share in dominant malls, inserted in relevant markets with high demographic density and qualified income. And, it was not particularly unexpected; however, we are certainly pleased with a couple of achievements. One, as to how quickly the digital and omnichannel solutions we had already been working on took place. And, secondly, our leasing team’s performance assured that our centers remained with a high healthy occupancy rate throughout the crisis.

What’s the best business advice you have received?

In Brazil, a couple of decades ago, when I was starting my career, I had the feeling everything was done as if improvised, with no focus on the best and just targeting the bare minimum. However, once I started working, my superiors advised me that you can achieve much more inspiring results and amaze the clients in a way they wouldn’t expect if you strive for excellence with no underdog complex. So, I can say that was the best business advice I have received: striving for and doing everything with excellence.

What’s the most important lesson you have learned in your career?

The most important lesson is that the best you can do for someone else is to help them learn, grow, and acquire knowledge. The power of gratitude, alignment, and engagement of someone who is learning and growing is much stronger than the ones for purely financial reasons.



Eduardo Sattamini, ENGIE Brasil Energia

What is the biggest challenge in your industry this year?

Brazil is experiencing its worst water crisis in 91 years. In a country where hydroelectricity is a critical energy source — responsible for nearly 70 percent of the Brazilian electricity matrix —water-shortage sounds an alarm for the economy in the short term. That’s because we are also in the middle of the recovery process from the coronavirus pandemic. Portfolio management, as well as deep operational experience, have never been more important in the sector. Both attributes are part of our value proposition at ENGIE Brasil Energia in the more than 20 years we’ve had a presence in the country. Although the magnitude of the hydro crisis has no parallel, the Brazilian system is much better prepared to cope with it because of new technologies and thermal capacity that have developed in the last 20 years.

What was the toughest business decision you made in the last year?

In 2020, we were focused on balancing customer consumption flexibility demands — mainly driven by their reduction in production output as a result of the pandemic and maintaining the financial health of our company. It was not easy to combine these interests, but we decided to do it by listening to the needs of our customers; we are talking about large companies in Brazil and adapting to what were real needs and opportunistic requests. Looking back, what we see now is that our strategy was not only successful in addressing short-term solutions but was also able to unlock win-win opportunities that paved the way for a rapid turnaround in our clients' businesses in 2021.

Have there been any unexpected opportunities for your business in the last year?

Definitely. The pandemic has brought home the importance of acting responsibly as organizations, as citizens, and as human beings. It was an unprecedented health crisis, bordering on a humanitarian collapse. In such a difficult context, no other unexpected opportunity was more relevant than being closer to vulnerable communities — and the people who most needed our support. We donated more than R$12 million to health institutions aiming to support the fight against the pandemic. We made impactful contributions for income-generation projects, in addition to philanthropy, and crisis relief initiatives. From a business perspective, we've seen our teams performing well in a hybrid working system, improving their quality of life while supporting the social distancing practices needed in our plants and offices. As CEO of ENGIE Brasil Energia, I am proud of every step our company has taken over the last year and very grateful to work with so many amazing people across the country.

What’s the best business advice you have received?

My beliefs are very simple and built on advice, role models, and my own experience. Work hard, always looking for the best version of yourself. Be persistent and have resilience. And every time you find yourself in a difficult situation, take the opportunity to grow and improve your ability to handle problems.

What's the most important lesson you have learned in your career?

Treat your employees with respect and empathy, always paying attention to the people who they are, not the numbers, roles, or resources they represent. Seeking kindness and proximity, promoting understanding and empowerment, as well as embracing different ways of thinking are fundamentals of trust. And only teams made up of people who trust each other, thrive in the long run — and build successful businesses.



José de Jesús Valdez, Alpek

What is the greatest challenge for your sector this year?

Our greatest challenge this year might surprise you. As a result of the strong global economic recovery experienced in 2021, downstream demand for our products has sharply increased, outpacing domestic supply in the Americas. Our customers have remained intent on producing more water bottles, food packaging, clothes, automotive components, and construction materials, just to name a few, which are all made from polyethylene terephthalate (PET), polypropylene, or expanded polystyrene (EPS).

This brought on the challenge of properly managing our supply chain to operate at the highest levels possible. We’ve largely been able to rise to the challenge, for example as during the Texas polar vortex experienced in February, where the majority of our competitors on the U.S. Gulf Coast experienced interruptions to their supply of raw materials, power, or natural gas. All throughout this period Alpek was able to continue operating without any incident, converting the low industry inventories for our main products into strong EBITDA for us.

What was the toughest business decision you made in the last year?

Last year, Alpek set forth a long-term growth strategy that included three different core pillars. One of them is to foster a circular economy for all its products, and its main action item was to grow our recycled polyethylene terephthalate (rPET) capacity to 300 thousand tons in order to meet our largest customers’ self-imposed goals of 25 percent recycled content in their packaging.

When CarbonLite, one of the largest rPET producers in the USA, went into bankruptcy and its assets went up for sale, we knew we had a hard decision in front of us. We had seen sharp variations to rPET’s pricing vs. virgin product; Alpek had made financial stability a priority during the Covid-19 pandemic; and the size of the acquisition was large, as the site we were interested in is one of the newest and largest in its category in the Americas.

In the end, we trusted our analysis and held true to our core strategy. We felt that despite its large size we were getting an attractive valuation and would make strong progress on our ESG targets. As a result, Alpek has reaffirmed its position as the Americas’ largest PET recycler.

Have there been any unexpected opportunities for your business in the last year?

We’ve already discussed how stronger-than-expected demand for PET, polypropylene and expanded polystyrene translated into positive results in 2020 and 2021. What was particularly unexpected for us is how these products have also expanded into new categories and applications.

During the pandemic we saw a marked increase in polypropylene usage for face masks and syringes, as well as for EPS in low-temperature Covid-19 test and vaccine transport cases. Moreover, PET has quickly replaced other plastics, aluminum, glass, and carton in packaging for products like shampoo, detergent, milk, eggs, juices, or lettuce, just to name a few.

The reason is quite intuitive, as PET is priced far lower than many of these alternatives, and brand owners are increasingly looking to migrate to products that are 100 percent recyclable, highly recycled in practice, promote a lower carbon footprint, and can be recycled back to their original purpose. We support this movement to a more circular economy and expect this trend to continue in the future.

What’s the best business advice you have received?

I’ve shared great experiences with countless people who have molded my approach to business. One that comes to mind is when I was a relatively young manager and my former boss told me to always “trust, but verify,” with an emphasis on the trust portion.

I’ve always believed that an important part of being a good leader entails giving people enough space to make their own decisions, and sometimes their own mistakes. At Alpek, having very diverse petrochemical industries, I’ve tried to foster a culture of highly independent and empowered business units, which allows them to respond nimbly to any market changes. An important part of achieving this balance is to listen far more than I speak. 

What’s the most important lesson you have learned in your career?

I truly believe that the importance of investing in people, and actively supporting them, cannot be understated. No idea, regardless of how good it is, can succeed without a good team to execute it. At Alpek we invest a lot of time in finding the right people, putting them in an environment that allows them to thrive, and eliminating any other distractions for them. If you let people surprise you, I’ve found they usually will.

Moreover, we’ve always strived to go beyond simply delivering results. As such, we also focus on ensuring our employees are fully heard and allowed to innovate, which we feel improves the odds of our long-term success.

Finally, work-life balance is crucial in ensuring employees stay motivated and operate at peak performance, and a positive finding from the Covid-19 pandemic has been our ability to work from home while maintaining high levels of productivity. When normal office life can resume, we will still try to hold on to these and other findings that promote higher wellbeing.

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